Federated CDNs: What every service provider should know

With this white paper, we will reveal how it is now possible to establish a central reporting repository that gathers data across all content owners and federation members, while also providing
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With this white paper, we will reveal how it is now possible to establish a central reporting repository that gathers data across all content owners and federation members, while also providing secure, private views of data relevant only to each participant – and how such an analytical hub can drive the success of a federated CDN.

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What Every Service Provider Should Know AboutFederated CDNs

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IntroductionThe concept of federated content delivery networks (CDNs) presents telecommunicationsservice providers with an unprecedented opportunity to compete directly with marketleaders like Akamai and Limelight in the global CDN arena.This opportunity is particularly appealing because service providers currently findthemselves trapped in a cost-revenue squeeze. While historical revenue sources shrink,they are forced to invest in costly infrastructure upgrades to accommodate soaring onlinevideo traffic; investments that they cannot recoup beyond modest consumer internetaccess fees.Many telcos, ISPs and cable providers have already begun to address this problem bylaunching their own regional CDNs as a means to reduce network video transport costsand create new revenue sources.But while service providers can capitalize on inherent home field advantages with theirlocalized CDNs — cost advantages and deep caching that come from owning the networkall the way to the user’s premises — they cannot currently parlay them beyond theirhome turf. Grabbing a piece of the prized global content delivery business will requirethat these service providers ally, combine operations and marketing muscle and providecontent owners with “one stop shopping.”However, executing this vision is extremely challenging.Consider the complexity of managing a network across multiple infrastructure operators,technology platforms, sales organizations, geographies, market segments, and businessmodels. Managing across all of these dimensions demands the ability to measure themindividually and in aggregate. This, in turn, demands a powerful reporting and analyticshub that can handle enormous volumes and high dimensionality.Such multi-dimensional analysis is critical to solving management problems of a single,localized CDN; the need only escalates in importance as CDN interconnection adds furtherdimensions and spawns questions like: • Which federation members actually delivered content to end users and how much? • Did multiple federation members participate in relaying content from its sources to the delivering edge servers? • Which members sold CDN services to or "own the relationships with" the content owners/customers?With this white paper, we will reveal how it is now possible to establish a central reportingrepository that gathers data across all content owners and federation members, while alsoproviding secure, private views of data relevant only to each participant – and how such ananalytical hub can drive the success of a CDN federation. IP Video Management Analytics 1

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The OpportunityMany service providers are building their own CDNs to extricate themselves from the cost -revenue bind created by shrinking landline revenues and rising online video traffic. Doingso can both alleviate the strain on their network backbone and create new revenue sources.Those telcos, ISPs and cable companies that embrace this strategy will reap tangibledividends. They will no longer be dependent on third-party content delivery providersand, in fact, can compete with pure-play CDNs at a regional level by offering lower costsand better quality of service (QoS).Service providers cannot currently compete against these pure-play CDNs on a truly globalbasis, though. It is just too inconvenient and inefficient for large content owners tocontract with scores of individual providers in order to cover their entire target footprint.Cobbling together a network in such a patchwork fashion would be a logistical nightmare.By federating to establish a “one stop shopping” value proposition, however, localizedCDNs can compete effectively against the content delivery kingpins.1. One Stop ShoppingService providers can win against pure-play CDNs by creating a unified customer experiencewhile insulating customers from the underlying complexity of a federated CDN. Localized Service Provider CDN Federated Service Provider CDN Disadvantages for Content Owners Advantages for Content Owners who have global audiences who have global audiences Many different reports in different formats One set of reports covering the entire and different levels of detail that must be operation integrated to get a true view of global operations. Inefficiencies and additional costs that come Single contract from negotiating lots of separate contracts Myriad bills from myriad providers Billing from a single source Hassle of validating varying service level Single SLA to validate agreements (SLAs) Separate log-ins, authentication and training Central access and procedures Separate contact for every problem that arises Centralized contact for maintenance and support Multiple points of content ingestion using Single integration to content management different integration methods system IP Video Management Analytics 2

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2. More Reliable, Higher Quality Video DeliveryFederation members can also offer content owners consistently high quality video deliveryacross the globe. This can create an important competitive advantage versus pure playCDNs – particularly as online video moves into the living room and customers demandincreasingly higher levels of video quality.By delivering video close to the end customer, service providers can offer QoS guarantees tocontent owners. In return, content owners and IPTV services can charge their customers forHD video programming that is comparable to that of cable and satellite pay TV services. Themore reliable, high quality picture resolution also becomes a more appealing environmentfor advertisers, who want to showcase their products and services in the best possible setting.By interconnecting CDNs, service providers can cache content deeply not only in theirnetworks but also in those of other participating networks. This allows a service providerto offer content owners the same local quality advantages everywhere, creating a globaledge. IP Video Management Analytics 3

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The ChallengeSignificant obstacles remain in the way of bringing the federated CDN concept to life,however; none so substantial as the sheer operational and management complexity involvedin deploying such a coalition.Consider a sampling of the variables at play:1. Cost Allocation: Complex rules and processes must be established to determine which member companies incur costs under what circumstances and at what rate. For instance, how is cost allocated when a request is generated in Spain for a video asset that originates in England? • Does the content get ingested in England into the content owner’s CDN and then get transmitted through the federated network to the streaming servers of a service provider in Spain? • Or does the content get ingested directly into the Spanish network?2. Revenue Allocation: Similar rules and processes must also be put in place to determine how revenue is allocated among member companies. • How will monies collected from content owners be distributed among federation members? • If a content owner was sold the federated content delivery by service provider A but the content is delivered by service provider B, who gets what cut of the revenue? This may be complicated since CDN charges are often not linear in the amount of content delivered (e.g. they may be based on peak or 95th percentile traffic).3. Routing: Establishing the methodology and mechanisms for determining routing decisions also introduces notable complexity. This may be especially problematic in “vertical” federations (wherein multiple members serve the same geography) and is intimately tied up with cost allocation. • To what peered CDN are content requests redirected? • Is routing prioritized based on the proximity of a server to the end user or by available server capacity? • What if certain operators choose not to federate with every other member? How would exceptions be handled? For instance, CDN A may sell services to content owners on the basis that they may be delivered by federation members B, C, D and E … but not by F or G. But CDN G may sell services on the basis that they may be delivered by any service provider, including CDN A. IP Video Management Analytics 4

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4. Service Level Agreements (SLAs): Each federation member defines and guarantees the level of service to its customers but these will likely vary from operator to operator. • How can participating members assure that SLAs are always met? • How would this be validated to content owners and aggregators? • Who is responsible for remedies in case of failures, particularly when they are statistical in nature and not easily attributable to specific incidents? For example, suppose that a federation customer has its content ultimately delivered by three different service providers but that 80% of it is delivered through just one of these. The customer may get its highest success percentage with the provider that serves the highest absolute number of failures (the 80% operator). If the customer’s SLA percentage is not met, is the penalty divided up based on number of failures or on failure rate?5. Billing: Each federation member is likely to have different billing and collection procedures, practices and technologies. These are but a few of the billing challenges that arise when exploring CDN federation. • How are they made compatible with one another? • How are discrepancies reconciled? • Importantly, how is the customer presented with a single, seamless billing experience?6. Confidentiality: While federation members are allied, they are still separate companies and may compete on some level. A key challenge exists in how to enable participating members to share resources but still conceal proprietary internal details from one another. Regulatory requirements (anti-trust and pro-competition measures, as well as privacy legislation) may further constrain how data is to be handled. In some cases, it might even be necessary to operate a federation without any one entity being able to see 100% of the full picture. IP Video Management Analytics 5

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The SolutionSurmounting these many operational and management challenges requires a high degree ofstandardization and integration among federated service providers. Ultimately, the contentdelivery process needs to work across service providers as seamlessly as international voice calling.One approach to integrating some of the necessary processes includes a portfolio ofcentralized “shared services” that every participant can utilize. A key example of such ashared service is a reporting and analytics “exchange.”Such an exchange could function as a central repository that gathers disparate data ofvarying formats from across the federation value chain. Fundamental to this repositorywould be the means to aggregate and process huge volumes of CDN data and — importantly— to provide the appropriate level of visibility to this data among the federation participants.This could include the CDNs, content owners, syndicators (content retailers like Netflix),and resellers. Data in Federation format 1 Operator Service Data View Provider 1 Connector 1 Data in format 2 Federation Member Service Data Operations Provider 2 Connector 2 View Common Data Model Federation Member Marketing View Data in format n Service Data Content Provider n Connector n Owner ViewKey requirements for a reporting and analytics exchange deployed in a major CDN federation are:• Multiple input formats: The reporting and analytics exchange must be able to process inputs from multiple CDNs, each of which may use a different technology platform and produce different types of logs or data extracts. The exchange must be able to normalize all of these formats into a common data model that represents the most important analytical elements for CDN operators and their content owner end customers. IP Video Management Analytics 6

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• Scale: Any individual CDN would likely produce such high-volume, high-velocity data that it would overwhelm any conventional business intelligence or data warehousing technology. The challenge of quickly generating rich, detailed business insights becomes exponentially greater in a global, multi-CDN environment.• Multidimensionality: CDN management involves a great many data attributes. Creating a federation only adds more to these (serving member, selling member, etc.). The reporting exchange must be sufficiently powerful to handle this dimensionality and to preserve it, even while serving up insights in near-real time.• Multiple means of presenting data: Different federation members will want to access the shared reporting repository in different ways. • Some will want to use standardized dashboards provided by the exchange. • Others will want to display the data in their own customized dashboards. • Still others will want data loaded into their own OSS/BSS or similar internal management systems. Therefore, the reporting and analytics exchange must be able to display data not only in a full-featured set of packaged dashboards but also through various APIs that allow both pushing and pulling of data into other systems.• Security: While all of the data about the federation’s operations would be brought into a centralized, shared database, it is critical that no member be able to see data that doesn’t pertain to their specific business and operations. This requires a solid, secure, “hack free” technology platform that has proven itself in similar scenarios.• Multiple views of data: A content owner needs to view reports that capture the entire consumption pattern of the content, regardless of which member CDNs ultimately deliver it. Meanwhile, a federation member needs to see reports containing all of the data that pertains to its business – whether that means all of the traffic that this member delivered or all of the traffic originated by content owners for which this CDN is the vendor of record. Additional views may be required for subsidiaries or divisions of the member companies or for business partners that resell for one or more of the member CDNs. As such, the reporting and analytics exchange must offer multiple standard views for different entity types, as well as the flexibility to build out new views to address evolving business requirements.• Flexibility: It is difficult enough to get one software application to completely meet the needs of a single customer. It will be even more difficult to fully satisfy the needs of all members of a CDN federation. Therefore, the underlying platform must be flexible and extensible enough to accommodate new requirements that might arise. These requirements could include new input data formats, new data attributes, new metrics, new reports, new views and so forth. A reporting and analytics hub must therefore include enough extensibility to evolve in any such direction. IP Video Management Analytics 7

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A reporting and analytics exchange that meets these requirements can address many of themajor challenges of federated CDNs in the following ways:• Cost Allocation: By quantifiably pinpointing “who does what for whom,” the reporting and analytics exchange can provide an objective analysis of each federation participant’s contribution to the overall load.• Revenue Allocation: Similarly, the exchange can quantify each member’s slice of the revenue pie based on customer relationships, delivery activities, or any other rule or criterion.• Routing: By highlighting bottlenecks and sources of errors, a reporting and analytics exchange can help to optimize network topology and, in turn, help member companies to maximize capacity and address service quality issues.• Service Level Agreements: By measuring performance of various factors in aggregate, as well as broken out by specific members, the exchange can help members to comply with each other’s SLAs.• Cofidentiality: A central repository can be configured with rules and permissions so that individual federation members are able to access data relevant only to them, while denying wider access to the data of other members. Access can be further segmented such that each member can view data across its customers or, conversely, that each customer could view data across participating CDNs. IP Video Management Analytics 8

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ConclusionTo become more competitive in the global CDN marketplace, service providers must formcooperative alliances that interconnect their networks. This will allow them to offer endusers worldwide with video resolution and reliability equivalent to cable and satelliteTV. More importantly, it will enable these providers to package comprehensive contentdelivery services as a one-stop-shopping experience to content owners that have large,geographically distributed audiences.Failure to do so will limit service provider CDNs to regional players. Cost and qualityadvantages may give them an edge over pure-play CDNs in their home markets but limittheir global aspirations unless they federate.Myriad complexities stand in the way of such a CDN union, however. These include factorsrelated to cost and revenue allocations, routing, billing and collection, service leveldelivery, and security and confidentiality.Key to overcoming many of these operational and managerial complexities is the abilityto establish a central reporting and analytics hub that can handle large volumes and highdimensionality, and which provide secure portals for value chain members to access dataspecific to their operations.Skytide Insight for Content Delivery Networks can uniquely support this reporting andanalytics vision because:• It can process the huge volumes of data that a federation of CDNs would generate — terabytes per day — and transform it into finished reports in minutes.• It can handle the complexities inherent with federation because it is powered by the Skytide Analytical Platform, which is designed for high-volume, high-velocity, multi-dimensional analytics. So Skytide can provide the level of richness and granularity necessary to properly allocate costs and revenue, comply with SLAs, and supply the meaningful insights needed to operate a multi-organizational business.• It allows service providers to offer the appropriate levels of data visibility at different points across the digital media supply chain. Telcos, ISPs and cable companies can provide secure portals to each of their customers, in turn enabling them to access data specific to their own operations. They can also provide individualized access to business partners such as resellers, content syndicators or company subsidiaries.• It is customizable and extensible, and accommodates rapidly evolving business models.• It is tested tough. Telco CDNs like BT, Telecom Italia, Telefonica and Telstra rely on Skytide to help them isolate and correct service quality issues, forecast and provision capacity, justify pricing and ensure accurate billing. IP Video Management Analytics 9

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Addendum — Case StudyAn important Skytide customer operates its CDN globally by managing locally. It delegatesimportant elements of control in both operational and marketing arenas to national orregional subsidiaries around the world. Each subsidiary has its own network infrastructure(POPs) and its own customers; in effect, the CDN as a whole represents a federation ofthese subsidiaries.Just as in a federation of unrelated companies, content belonging to one member’scustomers gets delivered by the infrastructure of other members. In this implementation,Skytide Insight for Content Delivery Networks captures transactional data in multipleformats from every subsidiary’s edge servers and translates it into a common data model.Slices of this data are revealed to stakeholders based on their responsibilities and spans ofcontrol.• Marketing staff at the subsidiaries can view all content delivery data from customers with whom they own relationships – regardless of which other subsidiaries might have ultimately performed the delivery.• Operational staff at the divisions can view all of the data about transactions delivered via their organization’s infrastructure – regardless of which subsidiaries own the corresponding customer relationships.• The product management team for the global CDN can view everything.• The Skytide application even provides specific views for resellers that partner with specific subsidiaries and “co-own” the relationships with certain content providers.This implementation provides a “laboratory” in which Skytide has isolated and solved someof the key challenges related to reporting and analytics for CDN federations. Thesechallenges are the same as those that would be presented by a global, inter-companyfederation and we are pleased to have cleared these hurdles in advance, offering a provensolution for the federation analytics problem. IP Video Management Analytics 10

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Related White Papers The 4 Keys to Telco CDN Success Many telecom service providers are building their own content delivery networks as a means to capitalize on the surge in Internet video coursing over their networks. With this white paper, we will reveal four key success factors necessary for Telco CDNs to effectively harness their competitive edge and realize success. Read Now How Telcos and ISPs Can Learn to Love OTT With this white paper we will demonstrate how it is now possible for telcos to improve their position in the content-to-consumer value chain, create a more sustainable business model to value chain members and profit from escalating over-the-top (OTT) video traffic. Read Now 7 Online Video Trends to Watch in 2012 The year ahead promises to be full of twists and turns for online video and the digital media supply chain that serves it. Dont be caught flat-footed. Read “7 Online Video Trends to Watch in 2012” to get an advance peek at the trends that will shape the industry and how you can capitalize on the disruption to come. Read Now IP Video Management Analytics 11